The lender confirmed it will be increasing rates by 0.75 per cent on its sub-prime range and 0.50 per cent on its mainstream, self-cert and buy to let products.
GMAC says it will not be accepting any more unlimited adverse business and it has reduced its maximum LTV to 90 per cent from 95 per cent.
The lender has also decided to stop accepting non-conforming BTL and right to buy business.
GMAC head of marketing Jeff Knight says: “Rates have been artificially low this year with new competition in the market. This is now forcing rates back to the right level.”
He adds: “Our changes to criteria is a tactical move by us. We want to be prudent what with the market going through a challenging time.”
Knight admits the move will see it reduce the volume of business it gets but says they are using it as an opportunity to re-evaluate its product range.
GMAC says it cannot rule out any further changes to products and rates.
GMAC will be withdrawing their rates tomorrow. It launched its current rates last Friday for packagers.
This can be seen as yet another example of the impact of the US sub-prime crisis on the UK mortgage market.
The last week has seen Edeus, Kensington, Mortgages Plc all announce rate increases. Other lenders including Infinity Mortgages, Unity Homeloans, UX Mortgages and Victoria have yet to launch a new range of products after withdrawing from the market.
Both Infinity and UX Mortgages yesterday confirmed they would be postponing their new ranges due to continued market turbulence.